Iran has dismantled a "terror network" backed by Israel's Mossad intelligence services which planned to disrupt the upcoming presidential election in the Islamic republic, the state broadcaster said on Sunday.

"The intelligence ministry has identified and arrested the members of this terror network, and confiscated their weapons," IRIB said on its website, quoting a statement by the ministry.

It said the arrested group was made up of 12 members, but did not say when it had been busted.

The ministry neither identified any of those arrested nor mentioned their nationality, but said the cell leader originated from an unnamed "regional Arab" country.

On June 14, Iran is to hold its first presidential election since massive street protests, stifled by a brutal state crackdown, marred the disputed re-election of Mahmoud Ahmadinejad in 2009.

Iran accuses its arch foes Israel and the United States of waging a deadly campaign of sabotage against its disputed nuclear programme, announcing from time to time the arrest of suspected Israeli or US spies, but provides little or no public evidence supporting the accusations.

The statement on Sunday said the group had been instructed "to conduct terrorist acts ahead of, and in particular, on election day" as well as "creating ethnic and religious divisions" in restive areas of Iran.

It said the group had already "hit several targets in a town," and that "its main culprit was in contact with a headquarters in Britain". It did not elaborate.

Last month the Islamic republic said it had hanged two convicted spies, one found guilty of working for Israel, and the other for the Central Intelligence Agency (CIA).

Western powers led by Washington and Israel are at loggerheads with Iran, saying its nuclear programme is aimed at developing an atomic bomb. Tehran has repeatedly rejected the allegation.

Israel, the Middle East's sole if undeclared nuclear-armed state, has refused to rule out military action on Iran.